I know voting is happening but I’ve been here a grand total of a week so I’m not expecting (or worried) about getting many (any?) votes. Yes, over time I will convert my primary way of making a living over to trading, but for now this is about sharing what I’ve learned and learning from others here. That will be enough until things open up again.
This week I’ve managed to continue building on returns vs. the S&P 500 Index. Right now I’m up 13.8% for the year while the Index is up 12.06% on a cash basis and 14.44% including dividends. I am fairly confident I’ll beat the index by the end of the year and here’s why.
The market reminds me of a fatally wounded animal that was just hit by a truck. It is trying to stand up and run but it falls right back down on its face. It doesn’t know its dead yet, but the manic nature of the swings suggests to me that its about to figure it out. That doesn’t mean there might not be a spike up for the MD trade – “Maximus Disapointia” – e.g. first the market will wipe out every last short, before then reversing and disappointing every single long. This actually might have already occurred Sunday night when the ES ran up to 1424 in the overnight session and by not holding 1420, it might be done now. Always keep the MD trade in the back of your mind, this is a core learning if there ever was one in trading – expect the market to inflict the maximum pain on everyone and you won’t be disappointed. That is, if you can avoid it!
Futures are down around 1404.50 as I write this so I think we could see a definitive break below 1400 tomorrow and the bus may not turn around like it did today. But that was one impressive intraday swing wasn’t it? I warned you to watch out for that yesterday.
Until next time, trade safe.
-EyeWall
